Gold Peak Industries : Announcement of 2016/2017 nine-month results of GP Batteries International Limited

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(Incorporated in Hong Kong under the Companies Ordinance)

(Stock Code: 40) Announcement of 2016/2017 Nine-Month Results of GP Batteries International Limited (For the nine months ended 31 December 2016)

Pursuant to Paragraph 13.09(2) of the Listing Rules, the Board of Directors of Gold Peak Industries (Holdings) Limited is pleased to announce the unaudited consolidated results of GP Batteries International Limited for the nine months ended 31 December 2016. GP Batteries Group's turnover decreased by 4.6% to S$568.1 million and the net profit attributable to equity holders of GP Batteries decreased by 43.3% to S$7.5 million.

Pursuant to Paragraph 13.09(2) of the Listing Rules, the Board of Directors of Gold Peak Industries (Holdings) Limited (the "Company") is pleased to announce the unaudited consolidated results of GP Batteries International Limited ("GP Batteries" and together with its subsidiaries, "GP Batteries Group") for the nine months ended 31 December 2016. GP Batteries is a 64.9%-owned subsidiary of GP Industries Limited which is in turn an 85.5%-owned subsidiary of the Company. Both GP Batteries and GP Industries Limited are companies listed on the Singapore Exchange Securities Trading Limited.

GP BATTERIES INTERNATIONAL LIMITED UNAUDITED CONSOLIDATED RESULTS For the nine months ended For the nine months ended 31 December 2016 31 December 2015 S$'000 HK$'000 S$'000 HK$'000

(Restated) (Restated)

(Note) (Note)

Turnover 568,101 3,203,351 595,588 3,329,754

Cost of sales (442,103) (2,492,886) (458,349) (2,562,492)

Gross profit 125,998 710,465 137,239 767,262

Other operating income & expenses 17,026 96,005 16,356 91,441

Distribution expenses (50,325) (283,768) (52,526) (293,657)

Administrative expenses (65,517) (369,431) (66,867) (373,833)

Finance costs (5,030) (28,363) (5,080) (28,401)

Profit before share of results of associates 22,152 124,908 29,122 162,812

Share of results of associates 5,791 32,654 3,690 20,630

Profit before income tax 27,943 157,562 32,812 183,442

Income tax (10,936) (61,665) (9,888) (55,281)

Profit after income tax 17,007 95,897 22,924 128,161

Attributable to:
Equity holders of GP Batteries	7,505	42,318	13,238	74,010
Non-controlling interests	9,502	53,579	9,686	54,151
17,007	95,897	22,924	128,161

S cents HK cents S cents HK cents

Earnings per share 4.75 26.78 8.16 45.62

Note:-

The Hong Kong dollar equivalents as shown above for illustrative purposes are converted at the average exchange rates for the respective periods.

REVIEW OF OPERATION

Turnover for the three months ended 31 December 2016 was S$196.7 million, an increase of 1.9% over the corresponding period last year. Turnover for the nine months ended 31 December 2016 was S$568.1 million, a decrease of 4.6% over the corresponding period last year.

Global demands for primary batteries and Nickel Metal Hydride batteries were slow growing and price competition was very keen. While sales of primary batteries increased by 2.6% for the three months ended 31 December 2016, sales for the nine months ended 31 December 2016 decreased by 2.8% over the corresponding periods last year. Sales of rechargeable batteries decreased by 6.9% and 14.2% for the three months and nine months ended 31 December 2016 respectively over the respective corresponding periods last year. The drop in the revenue of rechargeable batteries was mainly due to the discontinuation of a contract with a major customer of GP Batteries Group's Taiwan plant, which has ceased production

Sales in the Americas decreased by 18.0% while sales in Europe increased by 35.2% for the three months ended 31 December 2016 over the corresponding period last year. For the nine months ended 31 December 2016, sales in the Americas decreased by 31.6% while sales in Europe increased by 32.8% as compared to the corresponding period last year. The decrease in sales in the Americas and increase in sales in Europe was largely due to the relocation of the procurement office of a major customer from the USA to Europe.

Profit before income tax for the three months and nine months ended 31 December 2016 was S$10.7 million and S$27.9 million respectively as compared to S$9.1 million and S$32.8 million over the respective corresponding periods last year. Gross profit margin for the three months and nine months ended 31 December 2016 was 22.5% and 22.2% respectively as compared to 24.0% and 23.0% in the respective corresponding periods last year, mainly due to loss of income of the Taiwan plant.

Distribution expenses for the three months ended 31 December 2016 were S$20.0 million as compared to S$15.3 million over the corresponding period last year mainly due to increase in advertising and promotion expenses in order to capture market share. Distribution expenses for the nine months ended 31 December 2016 were S$50.3 million as compared to S$52.5 million over the corresponding period last year. The decrease was mainly due to a provision for doubtful debt of S$4.0 million that was made in the second quarter last year.

Finance costs for the three months and nine months ended 31 December 2016 were S$1.7 million and S$5.0 million respectively as compared to S$1.9 million and S$5.1 million over the respective corresponding periods last year. The reduction was mainly due to lower interest rates charged for the S$85 million three-year term loan facility.

Net other operating income for the three months ended 31 December 2016 was S$8.4 million as compared to S$2.2 million over the corresponding period last year, mainly due to (a) a higher foreign exchange gain of S$8.7 million was recorded in the third quarter this year as compared to a foreign exchange gain of S$1.1 million in the third quarter last year; which was partially offset by (b) a payment of US$1.45 million made in the third quarter this year pursuant to a customer's quality dispute on Lithium rechargeable batteries that were delivered in 2014 and 2015. Net other operating income for the nine months ended 31 December 2016 was S$17.0 million as compared to S$16.4 million over the corresponding period last year, mainly due to (a) a higher year-to-date exchange gain of S$12.6 million was recorded this year as compared to a year-to- date exchange gain of S$9.9 million last year; which was partially offset by (b) the aforementioned dispute settlement of US$1.45 million.

Share of profits of associates for the three months and nine months ended 31 December 2016 was S$2.9 million and S$5.8 million respectively as compared to S$1.3 million and S$3.7 million over the respective corresponding periods last year, mainly due to the improved performance of AZ Limited, GP Batteries Group's 40%-owned associate in Russia; and TG Battery, GP Batteries Group's 50%-owned joint venture with Toshiba, which manufactures cylindrical carbon zinc batteries.

OUTLOOK

There is conceivably significant unsold capacity within the industry and competition will continue to be keen. The strategy of consolidating smaller factories into bigger ones is on schedule and it is expected that cost competitiveness will improve after the consolidation. The production facilities for primary button batteries in Shanghai will be relocated to Ningbo and GP Batteries Group will incur some closure costs as a result in the fourth quarter of this financial year. As the new factories in Malaysia and Vietnam come on stream, they will start to contribute to revenue growth.

GP Batteries Group will continue to invest resources on building the "GP" brand and expanding the distribution network globally.

BOARD OF DIRECTORS

As at the date of this announcement, the Board consists of Messrs. Victor LO Chung Wing (Chairman & Chief Executive), LEUNG Pak Chuen, Richard KU Yuk Hing, Andrew CHUANG Siu Leung and Brian LI Yiu Cheung as Executive Directors, Messrs. LUI Ming Wah, Frank CHAN Chi Chung and CHAN Kei Biu as Independent Non- Executive Directors, and Ms. Karen NG Ka Fai as a Non-Executive Director.

By Order of the Board WONG Man Kit Company Secretary

Hong Kong, 8 February 2017

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